When I was at Forbes I learned that the American Stock Exchange, once known as "the curb," also had the nickname, "The Scam-ex." This was where people bought and sold shares of subprime public companies and where insiders and bucket shops conducted pump and dump scams on retail investors.

To those who ran the exchange, such talk was just snobbery. There were bad apples, sure, but not every public company is IBM. The Amex gave small companies a chance. Not all stayed small. Some grew big and stuck with the exchange. Besides, to protect its credibility, they hade every incentive to police their own lands or nobody would trade in Amex listed securities.

A few years later, as exchanges consolidated, NYSE bought the Amex (and after that, Euronext bought NYSE and after that...) Then we had the Financial Crisis. We all learned about derivatives and how certain of them, like credit default swaps, were not traded on exchanges at all. These were contracts between private entities. When they traded, they traded over the counter. OTC markets can work fine. But sometimes you have to wonder who you're trading with, what their means and intentions are and how they're paying.

The job of an exchange is to regulate security risk (am I really getting what I'm buying?) and counter-party risk (am I trading with a partner who has honest intentions and the means to meet their obligations?). The business objective of an exchange is to collect listing fees (how much can my exchange offer?) and to promote trading volume (how many people can we get trading?) These goals are in conflict.

On Tuesday, the Department of Justice arrested a trader who they say was a futures market manipulator who contributed to the 2010 Flash Crash, when the Dow Jones stocks fell 1,000 points in minutes. What struck me about the criminal complaint, though, was that our pirate trader worked his scam from 2009-2014. That means he traded for four years after the Flesh Crash. It's not that his manipulations went unnoticed. He received several stern letters from the CME Group, owners of the Chicago Mercantile Exchange. But he was never kicked off the exchange. I write more about it at The Daily Beast.

...E-mini trading spilled over into the equity market and helped trigger the extreme movements. But the E-mini trades (by Singh Sarao) that the agencies said triggered the big moves (that) were from a large trader, subsequently identified as Waddell & Reed.

Waddell & Reed has always maintained that their trades were not out of the ordinary.

When Wall Street crashes again, then the government will write a taxpayer backed (socialist) blank check (again) to put the casino players back in the business of playing main street for fools.

A bit strange - the naked short selling case of Overstock.com against Goldman Sachs, Merrill Lynch & Bank of America is much bigger, and Overstock humorously (or not) received a copy of internal emails specifically admitting the practice with typical trader bravado. The case against Goldman Sachs got thrown out because Overstock failed to prove the activity happened in California, but the court explicitly stated that Overstock had a triable case against Merrill Lynch's clearing division. It's been 10 years of people claiming Patrick Byrne is a paranoid psychotic, but all the suspected illegal activities have come out as true - even if as likely, no one will pay and no one will go to jail. Hey, it's the American Way™!!!

This gaming the bids stuff is SOP for the big firms who have license from the SEC to run scams...from the Marketwatch link in my post above:

Sarao characterized his own trading as just demonstrating to a friend “what occurs on the bid side of the market almost 24 hours a day....On social media, he was mocked both for soliciting outside help to create software and for the relatively small size of his profits relative to the disturbance he allegedly caused.

Lesson, it's OK to scam the little players, but don't make it obvious the dice are loaded.

Goldman Sachs proved time & again it's okay to scam the big players (half of the Greek bailout is Goldman Sachs' 2nd set of books). HSBC backed terrorists. Swiss bank & Barclays have major scandals... The lesson is "don't be a little fish or you'll get eaten; if you're Jamie Dimon you'll do fine".

Martha Stewart got whacked for a $40K inside trading goof. She set herself up as perfect front page fodder - feds get to pretend they do their jobs, Wall Street guys get a big chuckle, business goes on as usual, Wolf of Wall Street style.

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In the summer of 2016, as WikiLeaks was publishing documents from Democratic operatives allegedly obtained by Kremlin-directed hackers, Julian Assange turned down a large cache of documents related to the Russian government WikiLeaks in its early years published a broad scope of information, including emails belonging to Sarah Palin and Scientologists, phone records of Peruvian politicians, and inside information from surveillance companies. But by 2016, WikiLeaks had switched course, focusing almost exclusively on Clinton and her campaign.

WASHINGTON — Kara Young, a biracial model who dated Donald J. Trump for two years before he married another model named Melania Knauss, remembers clearly bringing up her race with the real estate tycoon early in their relationship. As with so many issues, he steered the conversation to celebrity.

Trump tweeted about his sadness over the loss of "beautiful" Confederate statues. He again equated a man who fought to create the United States with a man who knowingly fought o destroy the United States. Robert E. Lee could have led the Union Army. His sister's son fought for the Union. 40% of Virginia fought for the Union. Robert E. Lee chose to be a terrorist.

Trump champions the "Lost Cause". It is not surprising that he is unaware of why many of these Confederate statues were erected. Take the Robert E. Lee statue in Baltimore as an example. The statue was erected in 1948. The statue was meant to intimidate black soldiers and sailors returning home from World War II. It served as a reminder to those black men and women that white people were still in control

“Our country’s greatest strengths are the diversity of its people and the principles of equal dignity and inclusion that unite us all. There are troubling events planned in our state in the coming weeks. This is an incredibly painful and difficult time for millions of Californians. For those who are wondering where we stand – the ACLU of California fully supports the freedom of speech and expression, as well as the freedom to peacefully assemble. We review each request for help on a case-by-case basis, but take the clear position that the First Amendment does not protect people who incite or engage in violence. If white supremacists march into our towns armed to the teeth and with the intent to harm people, they are not engaging in activity protected by the United States Constitution.

There were no decent people marching alongside the white supremacists and Nazis. Decent people cannot work in the Trump White House. If you support Trump, you support a racist. You are an enabler. If you work for Trump, you work for a Nazi sympathizer, you are an enabler. Jewish people who work for Trump are working for a man who encourages anti-Semites. Blacks who work for Trump work for a racist who is attacking the black community. Hispanics who work for Trump work for a bigot who called Mexicans racists.

There are no decent political people hired by Trump working in the White House. (General staff like maintenance, kitchen staff, etc are excluded)

WASHINGTON — The renegotiation of the North American Free Trade Agreement is off to a rocky start.

The Trump administration lectured Canada and Mexico on the failures of the current agreement at an opening news conference Wednesday morning, while behind closed doors negotiators began to seek significant concessions from America’s neighbors.

“We feel that Nafta has fundamentally failed many, many Americans and needs major improvement,” said Robert Lighthizer, the United States trade representative, who is leading the United States team aiming to overhaul the 25-year-old agreement [....]

Transportation Secretary Elaine Chao stood shoulder-to-shoulder Tuesday with President Donald Trump, the same man who railed against her husband, Senate Majority Leader Mitch McConnell, last week and demanded that the lawmaker "get back to work" on health care."I stand by my man -- both of them," Chao said, when asked by reporters what she thought of her boss's criticism of her husband.

A Los Angeles-based tech company is resisting a federal demand for more than 1.3 million IP addresses to identify visitors to a website set up to coordinate protests on Inauguration Day — a request whose breadth the company says violates the Constitution.